Global Information Inc. would like to present a new market research report, "WORLD AGRICULTURAL EQUIPMENT" by The Freedonia Group.
Freedonias new report forecasts global demand for agricultural equipment to increase by 4.5% per annum to reach $124 billion in 2014. Gains in this market will be "paced by the accelerating mechanization of the agricultural sectors in developing countries," particularly in highly populated regions, such as China and India. Healthy economic growth in both India and China is creating increasing demand per capita consumption for all types of food products. Additionally, the farming sector in these two developing countries is still considerably "unmechanized and inefficient in comparison to those found in more developed markets." The resulting trend is for both the Chinese and Indian governments to focus on policies that support their respective farm sectors and "improve crop yields in order to ensure national food security."
The outlook, however, for developed regions of the world is not as bright. The study reports that although the US will experience gains such will lag behind world averages as an effect of decelerating growth it the countrys heavily mechanized agricultural sector. Meanwhile, research analysts expect Western Europe to post even weaker growth. Furthermore, farmers in both Western Europe and the US will be negatively affected by continuing trends that support free trade over protectionist policies (i.e. domestic farmer subsidies and tariffs on agricultural imports).
- World farm machinery market exhibited rapid gains hovering around 7% per annum from 2004 to 2008.
- When the globe entered recession, the farm machinery market saw demand drop by approximately 15% in 2009.
- Other developing nations with sizable agricultural sectors include: Brazil, Russia, Thailand, and Indonesia.
- Further urbanization in developing countries will make the replacement of human capital with fixed capital necessary.
- Russia and Brazil stand to benefit the most from growing export opportunities for agricultural goods.